Good Monday to you. Hope you had a nice recharging weekend. What an awesome display of commitment and hard work put on by many of the world's best athletes this weekend, eh? Couldn't get enough of the Olympic games. Seeing these young athletes finally have their day truly is amazing. Can you imagine the countless hours of dedication with no guarantee of any real reward for four years? Very inspiring to say the least. The markets sure are jubilating over the possibility of the Fed and the ECB (European Central Bank) working together to inject additional monetary stimulus into two of the largest world economies. Once word started to spread late last week that the Fed and the ECB were expected to act this week, the major indexes turned on a dime and erased the week's losses in no time. However, take all of the rumor, hype and media out of the equation and all you get is the continuing pattern we've seen now weeks. With slight exception to the NASDAQ Composite and NDX charts, the DOW Industrials and the S&P charts show the continued pattern of higher highs and higher lows. We've referenced this enough now to the point where it has become pretty obvious for anyone paying attention. Ever since the market put in a short-term low back in early June, these two indexes have continued this pattern. I've included a daily chart of the S&P here, which looks pretty identical to the DOW. See the trend lines I've included here? It's been almost scary orderly. The markets are typically never that obvious, which is what has us a bit concerned. Could the markets just continue like this, breakout and start a new leg up? Absolutely. The markets are always right regardless of what we or anyone else thinks. What has us concerned though is all of this jubilation and expectations of the ECB and the Fed doing exactly what everyone wants them to do. If your child wants a cookie before dinner, do you just give it to them because they want it? Is it necessarily the best thing for them even though they think it is? It's probably not the best analogy, but it does remind me of our current economic scenario. Everyone's looking for a cookie when in fact all they may get is a little cracker, or even nothing at all until after dinner. It's important to remember that our commentary prior to this earnings season was that corporate America had exhausted all of their cost cutting tools, reorganization attempts and efficiency improvements to the point where it was going to start showing their results going the other way this earning's season, and it has. Although earnings haven't been too bad, the top line revenue across the board for large and small caps alike, are starting to wane. With slowing revenues, unemployment and jobless claims continuing to weaken and GDP at its worst since the crash of '08, maybe the Fed and the ECB have had enough? However, if we take a step back, the markets have been pretty darn healthy now for quite some time, so it's possible the media is playing up their desire for Fed action far more than the Fed is really willing to take action. From a technical perspective, I've got something here that suggests a possible hint that our recent commentary suggesting a sharp move lower before we go higher could be in the cards. I've also included a chart of the NASDAQ Composite here for your review. This is important because again, the NASDAQ has led the charge ever since day one. Notice the NASDAQ over the last few weeks has NOT been unable to make that higher high and higher low? Is that an early sign of at least a short-term reversal? It's possible. Does the recent strength of the S&P and the DOW suggest a rotation of big money into more defensive and cyclical names? All important questions that will inevitably get answered in time. Bottom line is it's important to remember that in the markets and with any specific stocks, anything can happen. If you're not positioned or prepared to be wrong, that can be cause for huge disappointment and even bigger losses. So, even though we still believe we'll get a move lower before heading higher, we're prepared for this market to take off and leave many investors behind scratching their heads. CALL - An Obvious Stellar Earnings Report It's been pretty well documented in our newsletter that we've like magicJack maker, CALL, for quite some time. We've provided extremely profitable entries into CALL on three separate occasions over the last year or so with our most recent suggested entry back in early June at $14.82 per share. The stock has since moved higher hitting a high of just over $22 per share earlier this month, thus providing SCN Members with just over a 50% gain in roughly a month. Things could be getting interesting again as the Company came out on the open this morning announcing record breaking financial results for the quarter ending June 30, 2012. Q2, 2012 revenue was $38.6 million and net income was $10.3 million. Basic operating earnings per share (EPS) were $0.51 per share with only 19.4 million shares outstanding. You can read the press release in its entirety here: http://finance.yahoo.com/news/magicjack-reports-record-breaking-revenue-130000613.html. However, with today's news being the catalyst, shares of CALL appear as though they might be able to break above a key critical resistance level that has plagued the stock since it hit a short-term high of roughly $22.50 per share earlier this month. I've included a weekly chart of CALL here to explain. When the stock marched from our entry level of $14.82 to that $22.50 level and back off, that move represented a complete 5/8 retracement from its all-time high to its recent low. A perfectly logical move, not only for it to do what it did, but also with what the stock has done since. If shares of CALL can break above that $22.50 level in the coming days or weeks ahead and do it in convincing fashion, look out. The stock could be on its way to its all-time high of roughly $28 per share, which would represent the second 100% gain we've brought our readers in this stock since we initiated coverage on it late last year. I believe CALL is ultimately a takeout target for a major blue chip with interest in a nice VOIP play. In my opinion, it's only a matter of time. If you're interested in a long-term investing idea with very interesting upside potential, I'd seriously consider shares of CALL. I haven't found a reason not to like the stock yet, and that's a good thing.